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It is the second-lightest element in the Universe, has the lowest boiling-point of any gas and is commonly used through the world to inflate party balloons.

But helium is also a non-renewable resource and the world's reserves of the precious gas are about to run out, a shortage that is likely to have far-reaching repercussions.

Scientists have warned that the world's most commonly used inert gas is being depleted at an astonishing rate because of a law passed in the United States in 1996 which has effectively made helium too cheap to recycle.

The law stipulates that the US National Helium Reserve, which is kept in a disused underground gas field near Amarillo, Texas - by far the biggest store of helium in the world - must all be sold off by 2015, irrespective of the market price.

The experts warn that the world could run out of helium within 25 to 30 years, potentially spelling disaster for hospitals, whose MRI scanners are cooled by the gas in liquid form, and anti-terrorist authorities who rely on helium for their radiation monitors, as well as the millions of children who love to watch their helium-filled balloons float into the sky.

Helium is made either by the nuclear fusion process of the Sun, or by the slow and steady radioactive decay of terrestrial rock, which accounts for all of the Earth's store of the gas. There is no way of manufacturing it artificially, and practically all of the world's reserves have been derived as a by-product from the extraction of natural gas, mostly in the giant oil- and gasfields of the American South-west, which historically have had the highest helium concentrations.

Liquid helium is critical for cooling infrared detectors, nuclear reactors and the machinery of wind tunnels. The space industry uses it in sensitive satellite equipment and spacecraft, and Nasa uses helium in huge quantities to purge the potentially explosive fuel from its rockets.

In the form of its isotope helium-3, helium is also crucial for research into the next generation of clean, waste-free nuclear reactors powered by nuclear fusion, the nuclear reaction that powers the Sun.

Despite the critical role that the gas plays in the modern world, it is being depleted as an unprecedented rate and reserves could dwindle to virtually nothing within a generation, warns Nobel laureate Robert Richardson, professor of physics at Cornell University in Ithaca, New York.

"In 1996, the US Congress decided to sell off the strategic reserve and the consequence was that the market was swelled with cheap helium because its price was not determined by the market. The motivation was to sell it all by 2015," Professor Richardson said.

"The basic problem is that helium is too cheap. The Earth is 4.7 billion years old and it has taken that long to accumulate our helium reserves, which we will dissipate in about 100 years. One generation does not have the right to determine availability for ever."

Soon after helium mining was developed at the turn of the previous century, the US established a National Helium Reserve in 1925. During the Second World War, helium was strategically important because of its use in military airships.

When the Cold War came along, it became even more important because of its uses in the purging of rocket fuel in intercontinental ballistic missiles. The national reserve was established in the porous rock of a disused natural gasfield 30 miles north of Amarillo, which soon became known as the Helium Capital of the World.

A billion cubic metres - or about half of the world's reserves - are now stored in this cluster of mines, pipes and vats that extend underground for more than 200 miles from Amarillo to Kansas.

But in 1996, the US passed the Helium Privatisation Act which directed that this reserve should be sold by 2015 at a price that would substantially pay off the federal government's original investment in building up the reserve.

The law stipulated the amount of helium sold off each year should follow a straight line with the same amount being sold each year, irrespective of the global demand for it. This, according to Professor Richardson, who won his Nobel prize for his work on helium-3, was a mistake. "As a result of that Act, helium is far too cheap and is not treated as a precious resource," he said. "It's being squandered."

Professor Richardson co-chaired an inquiry into the impending helium shortage convened by the influential US National Research Council, an arm of the US National Academy of Sciences. This report, which has just been published, recommends that the US Government should revisit and reconsider its policy of selling off the US national helium reserve.

"They couldn't sell it fast enough and the world price for helium gas is ridiculously cheap," Professor Richardson told a summer meeting of Nobel laureates from around the world at Lindau in Germany.

"You might at first think it will be peculiarly an American topic because the sources of helium are primarily in the US but I assure you it matters of the rest of the world also," he said.

Professor Richardson believes the price for helium should rise by between 20- and 50-fold to make recycling more worthwhile. Nasa, for instance, makes no attempt to recycle the helium used to clean is rocket fuel tanks, one of the single biggest uses of the gas.

Professor Richardson also believes that party balloons filled with helium are too cheap, and they should really cost about $100 to reflect the precious nature of the gas they contain.

"Once helium is released into the atmosphere in the form of party balloons or boiling helium it is lost to the Earth forever, lost to the Earth forever," he emphasised.